External Trade

İktisatbank Foreign Trade Products for Imports and Exports

İktisatbank offers a wide range of foreign trade products for businesses importing and exporting in Northern Cyprus, including international advance payments, open account payments, documentary collections, foreign guarantees and letters of credit.

To help you evaluate the transaction method, you can find information below on payment timing, trust between the parties, required documents and the commitment undertaken by the bank.

Advance Payment

With advance payment, the importer pays the exporter before the goods are shipped. This method relies on the buyer’s trust in the seller. As payment and delivery occur at different times, delivery conditions and the seller’s obligations are important for the buyer.

Open Account Payment: Cash Against Goods

With open account payment, the importer pays for the goods after receiving them, on the date agreed by the parties. The seller ships in reliance on the buyer; the exporter faces the risk of not collecting payment on time. Payment terms and commercial conditions are agreed between the parties.

Documentary Collection: Cash Against Documents

Under documentary collection, the exporter submits shipping documents to its bank with collection instructions. The documents are sent to the buyer’s bank and released according to the instructions against payment or acceptance of a bill of exchange. A bill of exchange is a commercial document relating to payment of a specified amount.

Banks act as intermediaries for documents and collection; this role alone does not guarantee payment. If the buyer’s bank additionally provides an aval, meaning a payment undertaking on the bill, this is assessed separately.

Foreign Guarantees

A foreign guarantee is a bank undertaking issued at our customer’s request in favour of an overseas beneficiary. If the customer does not fulfil the specified obligation, the guarantee provides payment assurance for the stated amount under the demand conditions and time limits in its wording.

The guarantee amount, validity period and conditions for a payment demand matter. Discuss your contractual requirements with our bank to find out about guarantee terms.

Letters of Credit

A letter of credit is issued on the importer’s instructions and provides for payment to the exporter, or an undertaking for deferred payment, when documents complying with its terms are presented. Payment assurance depends on compliant documents and the credit conditions; it does not mean that the bank guarantees the physical quality of the goods.

• Applicant: The importer instructing its bank to issue the credit.
• Issuing bank: The bank issuing the credit and undertaking payment against a complying presentation.
• Advising bank: The bank advising the credit to the exporter; it undertakes an additional commitment if it adds confirmation.
• Beneficiary: The exporter in whose favour the credit is issued.

Features such as confirmation and payment at sight or at a future date affect the transaction terms. You can ask our bank about mixed-payment, acceptance, standby, revolving, red clause and back-to-back credits. The appropriate type and conditions are assessed for the transaction.

Contact Us About Your Foreign Trade Transactions

Share your transaction currency, amount, payment timing and contractual requirements with your İktisatbank branch. For information on required documents, fees and bank assessment conditions, you can also call Phone Banking at +90(392)444-4444.

For currency transactions, explore our business deposit and investment products. For insurance options relating to goods in transit, see our commercial insurance services.

Frequently Asked Questions About External Trade